The management of the Youreka Hotel in Amritsar, India, was concerned about the hotel’s overall returns relative to its annual operating cost and large initial investment. The new five-star hotel was now up and running and customers had started checking in, but occupancy levels were low. The hotel industry in India was making double-digit margins, but the hotel had not even achieved operational breakeven yet. Of key importance for the operations head was choosing the best seafood supplier – based on selling price, transportation cost and other factors – for supplying the hotel’s restaurants. A poor decision could have a negative impact on room occupancy and profitability. Among management, there were also concerns that the location of the hotel might be unfavourable. When could the operations head expect the hotel to match the profitability of the industry? What could he do to improve the hotel’s profitability?

In July 1996, Ross Cunningham, director of sales and marketing for the Delta Grand Pacific Hotel in Bangkok, Thailand, needed to devise a marketing strategy that would ensure the hotel’s success in its very competitive market. Cunningham wanted to ensure that the hotel would maintain and eventually increase its two key benchmarks of performance (occupancy rates and average room rates) by milking the Sukhumvit Micromarket to its fullest potential. Compounding this challenge was the anticipation of a sharp drop in occupancy at the hotel due to the likelihood that an important client contract would not be renewed.

Majestica Hotels Inc., a leading European operator of luxury hotels, was trying to reach an agreement with Commercial Properties of Shanghai regarding the management contract for a new hotel in Shanghai. A series of issues require resolution for the deal to proceed, including length of contract term, name, and staffing. Majestica was reluctant to make further concessions for fear that doing so might jeopardize its service culture, arguably the key success factor in this industry. At issue was whether Majestica should adopt a contingency approach and relax its operating philosophy or stick to its principles, even if it meant not entering a lucrative market.

The Roaring Dragon Hotel (RDH), a Chinese state-owned enterprise (SOE), was under pressure to become a profit generating 5-star hotel due to the continued development of the Chinese market economy. As for many SOEs, the RDH was overstaffed, filled with archaic work practices, internal cliques, unsystematic production systems and a dysfunctional motivation system unrelated to performance. During modernization, a number of human resource management problems became increasingly evident; solving these problems had become a priority. In 2000, the RDH’s provincial government and stakeholders made their first attempt at modernizing the hotel by hiring a globally renowned company to undertake the upgrade. The disastrous outcome caused the provincial government and stakeholders to lose heart, momentum and motivation until six years later. A new joint venture owner and the RDH board recovered enough confidence to attempt modernization for a second time. They contracted Premium Hotel Services (PHS) to undertake the second attempt at improving operations. The PHS found the quality of older employees, increasing turnover of new staff and policies emerging from the continuing evolution of the Chinese economy were now presenting problems never confronted before at the RDH. How could the stakeholders solve these problems and have the RDH emerge as an internationally recognized five star, commercially viable hotel?

A service delivery failure in the Mount Rundle Hotel escalates into a full-fledged confrontation between hotel management and the customer. The hotel general manager has an inward focus and is more intent on managing internal company systems and processes than catering to customer needs. The delay in responding effectively to the service failure leads to the involvement of the Better Business Bureau of Alberta, the Banff Lake Louise Tourism Development Board and the Banff mayor’s office.

In the spring of 2007, a vacationer is upset by the poor hotel experience he has had on the island of Guam. At the onset, the reasons for the bad experience seem to point to seemingly minor issues: bad management, poor service and old rooms. The value of the case lies in the analysis of the symptoms and arriving at the root causes of the problem, particularly the profit maximization strategy of the hotel’s owners in a mature industry. The case uses a different method of analysis, starting with micro indicators and moving to macro indicators: the analysis of symptoms, arriving at root causes, determining company strategy and finally assessing the company’s position using the Product Life Cycle Model.

The C&D Hotel, the first five-star deluxe hotel in Xiamen, a coastal city in China, needs to improve its service delivery process. In particular, the hotel’s customer service manager needs to present her plans for handling some recent customer complaints and decide how to compensate hotel guests for errors that have occurred during service delivery.